Tiffany Plans New Engagement-Ring Design

RAPAPORT... Tiffany & Co is preparing to launch a new engagement-ring concept as it heads into the holiday season on the back of solid second-quarter results.

The jewelry retailer highlighted several new projects that will frame its strategy in the second half of 2018 during its earnings conference call on Tuesday, transcribed by Seeking Alpha.

Among these, Tiffany plans to introduce a new engagement-ring design, Tiffany True, in the coming weeks, and into 2019.

“With the launch of Tiffany True, I think we will benefit also from a newness in this important category, even if we know [it] takes time to establish a new setting, a new design as a classic and as a bestseller,” said CEO Alessandro Bogliolo.

The retailer is also looking to expand its personalization program by increasing its marketing effort for the Make it My Tiffany program, which allows customers to create one-of-a-kind designs that can be engraved on jewelry and charms. Bogliolo noted “substantial customer interest” in the production-store, immediate-customization service, which Tiffany currently offers in more than 100 locations around the world. The jeweler also has plans to expand its engagement-ring customization program to various markets outside the US.

In addition, Tiffany will raise its marketing expenditure for its Paper Flowers collection — the first by creative head Reed Krakoff, which it launched in North America in May — as it extends the collection to Europe, Asia and other global markets.

China, the brand’s second-largest market after the US, will be the focus of new projects in the latter half of the year. Tiffany plans to expand its digital presence in the country, through an online pop-up store in conjunction with Luxury Pavilion, the luxury retail platform of Tmall, which it will roll out in September.

The Tmall pop-up follows the success earlier this year of a digital pop-up the jeweler did in partnership with WeChat in China.

Tiffany plans spending for the third and fourth quarters to be “well above” that of prior years, as it moves forward with this new strategy, which includes a new “whimsical holiday campaign” the company has planned for later in the year. However, Bogliolo believes the expenditure will pay off in the long term.

“We believe [the expense] is necessary to generate sustainable sales and earnings growth in the future,” he said.